BC Business
Sitting in the clubhouse locker-room at Warwick Hills Golf and Country Club in 1992, Richard Zokol listened intently as former Masters champ Ben Crenshaw talked about a course he was creating on a rural tract of sandy land in remote Nebraska: the newly opened Sand Hills Golf Club.
Zokol, only weeks away from his biggest triumph on the PGA Tour – a victory at the Greater Milwaukee Open – took in the master’s every word, as if recording directions to some buried treasure. “He spoke about it with such passion that I was drawn to the idea,” says the 49-year-old golfer once known as Disco Dick. “I knew right then that I wanted to build my own course.”
That dream, 16 years in the making, is now close to becoming a reality. The Sagebrush Golf and Sporting Club’s $8-million 18-hole golf course – which sits on a dramatic hillside near Merritt, once part of the fabled Quilchena Ranch – is set to open late this summer. Zokol has worked for almost a decade fashioning the course, and at every step in the process naysayers told him he wouldn’t make it: he didn’t have the money, the connections or the experience.
Even Zokol admits he had his doubts. “I asked myself how I would pull this one off,” he says. “I’m the consummate PGA Tour journeyman. I wasn’t the most skilled. I figured it all out through perseverance. I never made a fortune playing the game and got my nose bloodied more often than not.” With real estate sales at Sagebrush kicking off this spring – and with the course’s grass filling in the bare patches in the fairways – the next few months will determine whether Zokol’s unusual business venture will prove a scrappy success or a knockdown failure.
It isn’t an unusual position for Zokol, who’s fought most of his life to prove others wrong. The son of a Slovenian immigrant who became a dentist after the Second World War, Zokol grew up next to Marine Drive Golf Club, where he’d spend hours pounding balls, playing and practising. Few felt Zokol would ever succeed at the game. As a golfer he was never the longest, the biggest or the best. But with determination and imagination, Zokol excelled beyond his natural abilities. He led his team at Brigham Young University in Utah to an NCAA championship and later turned pro. In 412 events between 1983 and 2003, he gained a reputation as a free thinker, someone who often went against the status quo. He had 20 top-10 finishes, one win and total earnings of $1.8 million.
His time on tour was limited, and by 1995 he was playing less and less frequently, often spending extended periods of time at his home in Vancouver with his growing family. As his golf career waned, Zokol became more involved in business ventures, including helping launch Eaglequest Golf Centers Inc. But his success in the corporate world never reached the levels he’d witnessed in his golf career. By 2000 he was back on tour, a stint that would last until back problems derailed him in 2003.
A year after Zokol’s final attempt at the PGA Tour, he was back dreaming about his golf course. Following Crenshaw’s lead, Zokol wanted to build something different from almost any other course in the country. He wanted to make it an exclusive enclave not unlike the elite links where the rich and famous play on Long Island, New York. He wanted to create a club with an experience that rivalled the best in North America. But to outshine places such as Capilano Golf & Country Club in Vancouver, the notoriously exclusive Redtail Golf Course near St. Thomas, Ont., or Mount Bruno, haunt of Montreal’s most powerful businesspeople, it had to have atmosphere, access to world-class fishing and a great golf course.
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At first Zokol envisioned his project in the U.S., likely on Whidbey Island in Washington state. But that was at the height of the tech bubble, when money flowed; once the bubble burst, that idea died. The project would remain on hold until March of 1999, when Zokol was driving on the Coquihalla Highway, returning with his family from a skiing holiday, and happened to pass through the picturesque Nicola Valley, three hours east of Vancouver. The area has an extensive history of ranching and an enviable dry climate. Zokol was immediately struck by the possibilities. “The Nicola Valley blew my mind,” Zokol says. “My intuition was fired up.”
The idea lingered for two years while Zokol chased another shot at the PGA Tour. Eventually, he returned to the Nicola Valley and set his sights on the Douglas Lake Ranch, then owned by notorious telecom fraudster Bernie Ebbers. Zokol connected with Ebbers, but any possibility of a deal disappeared when Ebbers, then CEO of WorldCom Inc., became entangled in a corporate scandal that would eventually land him in jail.
Zokol, undeterred, continued searching and finally stumbled upon the Quilchena Ranch – a massive property encompassing about 10,000 hectares and supporting 1,500 cattle. It had recently been partially zoned for a golf course.
Zokol contacted the ranch’s owner, Guy Rose. “I cold-called him and said, ‘I’m Richard Zokol, and I’m a professional golfer,’ ” Zokol recalls. “He said, ‘I know who you are.’ ” That led to a lengthier discussion about Zokol taking over the land zoned for a golf course. They worked out a deal that allowed Zokol to lease 157 hectares for 149 years. The cost was $100,000 annually, and Zokol didn’t have that kind of cash, so he began knocking on doors and making phone calls to find investors.
Finding people willing to buy into the dream course proved difficult. Zokol was working with a unique business plan that would create one of the most expensive golf courses in the country. Most traditional private golf clubs take an initiation fee, which can range up to $100,000 in Canada, and charge thousands more annually to cover costs, but Zokol’s concept for Sagebrush was different. He envisioned a system in which 40 members would pay $200,000 for the privilege of joining and $5,000 annually toward resort services. That amount would allow them to use the course for corporate outings and to invite three other members each year, who would only pay $7,500 in annual fees.
As Zokol struggled to make his financial projections work, an explosion of golf development dramatically changed the competitive landscape in B.C.’s Interior. Developments such as Tobiano in Kamloops, Tower Ranch in Kelowna and the Rise in Vernon began to offer residential real estate alongside courses created by celebrity designers such as Tom McBroom and PGA Tour star Fred Couples. More developments are expected in coming years, including a project involving Canadian golf superstar Mike Weir.
“If I had a golf development opening now, I might be concerned,” says Riley Twyford, a Royal LePage agent in Vernon, B.C. “There are a lot of big developments out there all fighting for the same dollars.” But this red-hot demand for resort real estate – coming largely from oil-rich Calgary, but also from a booming Vancouver economy – might be just the thing to save Zokol’s project. It wasn’t until Zokol and his advisers determined there were real estate possibilities on their leased property that the numbers finally started to add up. It turns out that parts of the ranch are zoned for low-density residential development, with one home for every four hectares.
The possibility of 37 homes on the site raising a possible $21 million increased Zokol’s chances of successfully creating his course. “I’d spoken to Dick about this for a long time,” says Rene Palsenbarg, president of commercial real estate at Sotheby’s International Realty Canada, marketers of the homes. “Without the real estate component, Sagebrush would be very hard to make work from a financial perspective. The real estate makes it fly.”
It also brought in investors. Cal Payne and Roy Jeffrey, founders of communications tower company WesTower Communications, set up Four For Fore Investments Ltd., along with a pair of executives from WesTower, Peter Jeffrey and Val Rundans. Together they are financing $17 million of the project. “Dick’s plans took a while to evolve, but eventually they got to the point where we decided to become involved in the funding,” says Payne. “Maybe this is a bit risky, and maybe it isn’t the shrewdest investment, but it was something that we were interested in. We like Dick’s vision and the timing was right for us.”
While competition remains stiff – Palsenbarg is also pitching property for several other golf and residential developments – Zokol argues that he isn’t promoting another cookie-cutter real estate development, but a boutique concept. Buyers must acquire the pricey golf membership before buying any of the 37 lots, which range from 0.8 to 2.4 hectares and cost between $450,000 and $750,000. Most golf course developments build their residences in one area, limiting the cost of expensive hydro lines, pipes and other infrastructure. Sagebrush bucks that trend, scattering its homes throughout the property.
Despite a rosier financial picture, not everything has followed Zokol’s carefully crafted plan. The original idea was to be partially open last summer – allowing Zokol to market Sagebrush’s real estate component to members of the golf course – but because of time-consuming design consultations between Zokol, course designer Rod Whitman (best known for creating Blackhawk Golf Club near Edmonton) and agronomist Armen Suny, it soon became apparent that the course would not be ready until spring 2008. The big launch of Sagebrush would have to wait a full year.
Prospective real estate buyers, many of whom will make their final decisions based on the quality of the course, don’t mind putting in the time, according to Zokol. “I have a long list of people who are waiting for this project to be finished before they’ll commit,” he insists. “They are waiting to see if I can get it across the goal line.” While not surprised by the skeptics who read any delay as a sign of Sagebrush’s imminent failure, Zokol remains characteristically confident.
“People are saying if it takes this long, they’ll assume I’m not going to make it. But I’m not trying to prove anything to anyone,” he says. “This is par for the course in the development world. I was hoping this golf course would be fully open before I turned 50 – but in reality, things don’t always go as planned.”
The success of Sagebrush should be determined relatively quickly, says Mark Schmidt, a lawyer with Davis LLP and a legal counsel to Sagebrush who helped craft the project’s real estate development strategy. About 25 lots will have to be sold for Zokol to cover his loans to the WesTower group; Zokol says seven lots are already spoken for, and three will be turned into an on-site lodge, leaving 27 for sale. “We’ll know exactly where things stand in a few months,” says Schmidt.
“Our only real concern [with the delay] is the market could change,” adds Palsenbarg. “And yes, there’s a lot of product on the market for golf and residential developments, but that product isn’t like Sagebrush. If this were just a golf course development, then yes, that is everywhere. But this is unique.”
As Zokol prepares to jump-start his golf career again – when he celebrates his 50th birthday in August, this time on golf’s seniors circuit – he’ll also be pitching memberships for Sagebrush. At $200,000 per membership, it won’t be an easy sell. But nothing has ever come easily to Zokol. Not his amateur golf career, nor his time on the PGA Tour. Why should it be any different now?
“I trusted my abilities on the PGA Tour and I trust my abilities when it comes to Sagebrush. I cannot wait until the market sees this golf course. I can’t wait,” he says breathlessly, before taking a moment’s pause. “The market will decide,” he adds. “And the truth is the market never lies.”